Health and Human Services has given Arkansas permission to take federal dollars for Medicaid expansion and use the money to buy private coverage through the new PPACA healthcare exchanges. Avik Roy thinks the decision “moves us one step closer to the Swiss model” where everyone buys private insurance, though about a third of citizens receive a sliding-scale, means-tested subsidy to do so. Roy, from his recent piece on the free-market future of US healthcare:
Medicaid recipients face a strong disincentive to seek work, because entry-level jobs can force them to give up their health coverage in exchange for modestly higher income. The exchanges would allow these workers to climb up the income ladder while maintaining their insurance.
One likely result would be better healthcare access and better heath outcomes, though the plan would cost more money initially. Coverage on the exchanges could be as much as 50% more expensive than coverage through Medicaid, according to the CBO. On the other the hand, Arkansas’s surgeon general says co-pays may be used to “discourage emergency room trips, but not applied to preventive health care, such as immunizations, mammograms or annual check-ups.”
Politico reports that Ohio Governor John Kasich, a Republican who has been hammered by the right for accepting the PPACA’s Medicaid expansion, “has asked for a similar arrangement, but CMS has not announced a decision.” Other similarly criticized GOP governors, such as Rick Scott and Chris Christie, could redeem themselves on the right by following a similar path that’s both smart politics and smart, pro-market policy.